Qatar to leave OPEC from January 2019
Qatar has announced its withdrawal from Organization of Petroleum Exporting Countries (OPEC) from January 2019 and focus more on the production of natural gas. It makes Qatar first Gulf country to leave OPEC bloc of oil-producing countries led by Saudi Arabia.
Qatar has been member of OPEC since 1961 and its decision to pull out after more than five decades comes at turbulent time in Gulf politics. It is under boycott from its neighbouring gulf allies including Saudi Arabia for 18 months (since August 2017).
Key Facts
Qatar is the world’s largest exporter of liquified natural gas (LPG) and 17th largest producer of crude oil (around 600,000 barrels per day). It also only holds around 2% of the world’s global oil reserves. The withdrawal decision reflects Qatar’s desire to focus its efforts on plans to develop and increase its natural gas production from 77 million tonnes per year to 110 million tonnes in the coming years. Being part of OPEC its oil production was steady with limited prospects for increases. Since 2013, amount of oil Qatar produced has steadily declined from about 728,000 barrels per day (2013) to about 607,000 barrels per day (2017), or just under 2% of OPEC’s total output.
Organization of Petroleum Exporting Countries (OPEC)
OPEC is an intergovernmental organization (or cartel) of 15 oil-exporting developing nations that coordinates and unifies the petroleum policies of its member countries. It was established in 1960 in Baghdad, Iraq by the first five members. Its headquarters are in Vienna, Austria.
Its mission is to coordinate and unify petroleum policies of its member countries and ensure stabilization of oil markets, in order to secure an efficient, economic and regular supply of petroleum to consumers, steady income to producers and fair return on capital for those investing in petroleum industry.
OPEC member countries accounted for an estimated 43% of global oil production and 73% of the “proven” world’s oil reserves. Two-thirds of OPEC’s oil production and reserves are in its six Middle Eastern (west Asian) countries that surround the oil-rich Persian Gulf.
OPEC Members
- Asia and Middle East: Iran, Iraq, Saudi Arabia (de facto leader of OPEC), Kuwait, United Arab Emirates and Qatar (to withdraw from January 2019)
- Africa: Algeria, Angola, Libya, Congo Nigeria, Equatorial Guinea and Gabon
- South/Latin America: Ecuador and Venezuela
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Month: Current Affairs - December, 2018